Week Ending May 6, 2011
Federal Budget, Debt Ceiling and Deficit Reduction Efforts Moving Slowly Forward in Congress
Congress resumed work on the fiscal year 2012 budget, but the path forward is unclear. Before the Easter recess, the House passed Budget Committee Chairman Paul Ryan’s (R-WI) irresponsible and harmful budget, which would decimate Medicare, Medicaid and critical programs for low-income and working families in order to fund huge tax cuts for wealthy Americans and corporations without significantly lowering the budget deficit.
In the Senate, Budget Chairman Kent Conrad (D-ND) continues to be involved with bipartisan talks on the budget but it appears unlikely, despite months of negotiations, that this group will agree on a final plan or garner significant bipartisan support. In the meantime, Sen. Conrad is preparing his own budget plan that would cut $4 trillion from the federal budget in the next 10 years. The details have not been released, but it is expected to include deep domestic programmatic cuts and to be more drastic than the President’s revised budget proposal.
AFSCME is strongly opposed to cuts in services or including global budget caps in the budget plan, like the proposal by Sens. Bob Corker (R-TN) and Claire McCaskill (D-MO), which could have an even more devastating effect on Medicare and Medicaid and other services than the Ryan budget. AFSCME is insisting that the burden of deficit reduction must not be on the backs of low-income and middle-class families. To make matters more complex, potential budget process changes and deficit reduction efforts appear increasingly tied to raising the federal government’s debt ceiling. The debt ceiling must be increased by August 2 in order to preserve our country’s financial standing and make good on current debt obligations.
In addition, new bipartisan deficit reduction talks began this week, led by Vice President Biden along with Reps. Eric Cantor (R-VA), Jim Clyburn (D-SC), Chris Van Hollen (D-MD) and Sens. Jon Kyl (R-AZ), Daniel Inouye (D-HI), and Max Baucus (D-MT). The group, which was created by President Obama to address the deficit, is expected to continue its work next week.
AFSCME Members and Retirees Active during Recess
AFSCME members and retirees took advantage of the recent congressional recess to organize in-state meetings with key senators to describe the local impact of such drastic cuts to Medicare and Medicaid as are being proposed in Congress. Retiree chapters met with local newspaper editorial boards to discuss the severity of the House Republican budget plan, and also wrote letters to their members of Congress describing how the proposed changes to Medicare and Medicaid would affect them personally.
Senators and County Leaders Pledge to Fight Efforts to Slash Medicaid
In a letter to President Obama, more than half of the Senate’s Democrats announced their opposition to proposals that would institute block grants or cap federal spending for Medicaid. At a press conference which included several representatives of the National Association of Counties on May 4, Sen. John D. Rockefeller (D-WV), the leader of this effort in the Senate, emphasized that while spending caps may appear more benign than a block grant and therefore garner political support, they would have an even greater damaging impact on the Medicaid program and fails to take into account the aging of the population and rising health care costs. Either a block grant or severe spending caps would result in a tremendous cost shift from the federal government to seniors, people with disabilities, poor children, pregnant women, providers and states.
Medicaid is an integral part of our health care system, providing affordable, comprehensive coverage, including long-term care, for 60 million Americans. It is critically important in paying for our nation’s hospitals, providing nearly one dollar for every dollar spent on hospital care. While most of the beneficiaries are poor children, most of Medicaid funds are used to pay for the more extensive and expensive health care needs of seniors and people with disabilities both in institutions and in home care. Medicaid is also one of the largest sources of revenue to states and is vital to local economies and to maintaining jobs in the health care sector.
AFSCME will continue to work with our allies to protect and strengthen the Medicaid program and fight all efforts to convert it into a block grant or slash funding through federal spending caps.
House Hearing on Public Pensions
The House Ways and Means Oversight Subcommittee held a hearing on May 5 on funding levels for state and local public pension plans. The hearing also highlighted the problematic Public Employee Pension Transparency Act (H.R. 567). This was the fifth hearing this year scheduled by the House Republican majority on public pensions this year. Democratic House subcommittee members noted that this misguided and unnecessary legislation would force states and localities to calculate their long-term pension obligations using an unrealistically low “riskless rate” of return on investments.
AFSCME opposes H.R. 567 because it would significantly exaggerate plans’ perceived financial obligations and thereby increase pressure on states and localities to reduce pension benefits, increase employee contributions, or raise taxes or cut spending on vital social services to increase employer contributions. This legislation is ideologically motivated, reflecting an effort to end defined benefit pension plans in favor of defined contribution plans, which would shift economic risk from employers to employees and retirees.
The Ways and Means Committee may vote on H.R. 567 as early as next week.
House Republicans Continue Attack on Quality, Affordable Health Care
House Republicans continued their attack on quality, affordable health care this week by passing three bills to defund and repeal specific components of health care reform.
On May 3, the House voted 238 to 183 to pass H.R. 1213, which would repeal funding from the Affordable Care Act for states to establish transparent and competitive insurance exchanges. The bill cuts $14 billion over 10 years at the expense of low-and moderate-income Americans being able to access insurance through the exchanges, increases costs to employers, increases premiums and would increase the number of uninsured by about half a million in 2015, all of which would further strain the health care system. The vote was along party lines, with five Democrats, Jason Altmire (PA), Dan Boren (OK), Luis Gutierrez (IL), Tim Holden (PA) and Mike McIntyre (NC), voting in support of repeal.
On May 4, the House voted 235 to 191 to pass H.R. 1214, which would defund grants for school-based health centers. The vote again was along party lines, with four Republicans, Joe Heck (NV), Mike Kelly (PA), Steve LaTourette (OH) and Allen West (FL), voting against the legislation and three Democrats, Jason Altmire (PA), Dan Boren (OK), and Mike McIntyre (NC), voting in favor of terminating federal funds for school-based health clinics which keep students healthy and learning. The bill would defund some 357 applicants in 45 states, the District of Columbia and Puerto Rico, who have so far sought funds through the first round of competitive grants.
On May 4, the House voted 251 to 175 to pass H.R. 3, which would prohibit any tax credit that results from amounts paid for abortion services or, under certain circumstances, the costs of a health benefits plan that includes coverage of abortion services except in cases of rape, incest or danger to the woman’s life. Further, it would not allow the costs of abortion services, other than under the excepted circumstances mentioned above, to count as a deductible medical expense in determining income tax liability. Most insurance plans include coverage of abortion. H.R. 3 makes any small business or individual that has a health care plan that includes coverage of abortion ineligible for the small business health tax credit and the premium assistance tax credit, thereby raising taxes on potentially millions of otherwise eligible small business owners and individuals. By raising taxes on certain individuals and employers, H.R. 3 could force them to drop abortion from their health insurance plans, leaving millions without abortion coverage and taking away a critical benefit that many people currently have. It also jeopardizes women’s health by not allowing for exceptions even when a woman faces serious, permanent health risks.
AFSCME Corrections United and AFSCME United Nurses of America Lobby Congress
This week, AFSCME nurses and correctional employees lobbied Congress on pressing issues. The nurses took to the Hill to speak with members of Congress and their staff about Medicare and Medicaid. In particular, nurses expressed opposition to various proposals and schemes that would make severe cuts in Medicare and Medicaid. Nurses spoke about the need to maintain these programs, drawing on their experience treating patients who are served by these vital health programs.
Corrections officers lobbied on several public safety issues, including private prisons, procedural rights, bulletproof vests and the need for federal funding for state and local public safety programs. The corrections officers also lobbied against the Public Employee Pension Transparency Act (H.R. 567; S. 347), which is aimed at undermining public sector defined benefit pension plans.
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